By Benjamin Guggenheim
House Republicans are planning to quadruple the cap on state and local tax deductions to $40,000, under a catch-all amendment for their sweeping domestic policy legislation.
The amendment would also tweak provisions affecting remittances from people in the U.S. to those in foreign countries, gun silencers and new savings accounts for children. Plans to kill a 10 percent tax on indoor tanning imposed by the Affordable Care Act were dropped.
Republicans released the slew of proposed changes to their tax, border, defense and energy bill on Wednesday night, shortly after the House Rules Committee wrapped up nearly 20 hours of debate on the legislation. A committee vote is expected in the coming hours, followed by swift floor action by Republican leadership.
The amendment includes changes to the SALT deduction, previously reported by POLITICO, which were made as part of a deal between House GOP leadership and blue-state Republicans.
Under the plan, the cap on the deduction would rise to $40,000 from $10,000 but be phased out for taxpayers making more than $500,000. The $40,000 deduction cap and $500,000 income limit would increase by 1 percent through 2033.
Regardless of income level, all taxpayers would still be guaranteed a SALT deduction of $10,000.
However, married couples would get the same deductions as individual taxpayers — despite a long campaign from SALT Republicans to double the deduction cap for joint filers.
Elsewhere, lawmakers would cut a proposed tax on remittances to 3.5 percent from 5 percent.
The amendment also includes an expansion of tax breaks on silencers for firearms. Tax legislation passed by the Ways and Means committee earlier this month eliminated a $200 tax on the transfer of silencers.
The amendment would also get rid of a $200 tax on the making of silencers.
The legislation would also rename so-called MAGA accounts, a new type of savings vehicle Republicans want to create for children, as “Trump” accounts.